Capital Ethiopia Newspaper

“The first national business conference”

No sooner than dividend tax on undistributed profits was declared, a gust of despair had started to blow among the business circles that worried them as to what to do with the bitter pill.
It was kind of bizarre for most of them to swallow and digest no matter how much one tried to sweeten it.  Generally speaking, retained earnings being a sum of money that is put back into an enterprise, be it a share or a private limited company by way of capitalization, which does not go directly and immediately into the pockets of the individual owners/shareholders, banks were not exception to it.  For sometime, the business circles were out of the frying pan into the fire when the Ethiopian Revenue and Customs’ old officials imposed interest and penalty charges, although they had later agreed to drop their claim.
The new move declared by the Prime Minister and his Finance and Economic Development Minister to relax dividend tax collection was a kind of input that shook the status quo to its foundation.  No one had expected such a move to come out so suddenly and swiftly.  Without being presumptuous, the move that is currently taken by the Federal Democratic Government is a reflection of understanding of peoples’ concern and a necessary concomitant of a new mind set, and it is a system of enlightened governance.  The correct step taken at a propitious point in time by the Government will make a difference in as much as it is forward looking, that glosses over the hazy horizon of leadership.  This is what entrepreneurs allude to sacrificing short-term benefits for long-range goals. 
On the other hand, the agenda of the first National Business Conference at the UN Conference Centre had, as reported, a lot of representative issues that had caught the attentions of the business circles as well as that of scholars.  Another hot issue that the Prime Minister had dwelt on was the dichotomy between the public and the private sectors.  His underlining that the Government is not crowding out the private sector in favour of public investment and his pronouncement that a new law is in the offing, one would be quick enough to take such a move as a sign of quality and transformational leadership. 
It seems to me; it is through such transparency that the meeting of hearts and minds among the Government and those agents of change at the development front, and the national and international beneficiaries, come closer than ever to think harmoniously towards the optimal realization of the same goal.  It is misleading though; to think sometime just lightly that one would be able to do this or that.  Certainly, some people contend that there are some elements or things that should come out of the Government’s pawns and be left to the private sector by way of fighting Government’s indirect or direct influence of the economy, not only to respond to the international financial organizations’ pressure or working mechanisms, but, it is an important aspect of decision mechanism to empower the private sector to unleash its prowess of creativity and entrepreneurial talent by way of satisfying correctly the pre-requisites of privatization in enlarging its role.  One should not be naïve however, on matters of down-to- earth reality.  Basic infrastructure undertakings in electricity, road and rail constructions, shipping or airlines of larger magnitude, or telecommunications and the big likes, if left entirely or partially to the private sector only, at the take off point of the country’s development, chances are that such bravado may lead to uncorrectable committal of error.
It is here that the Government and the business circles need to see carefully the indirect and most decisive influence of small and medium enterprises (SMEs) in public undertakings, which indirectly bring the fusion of the public and private sectors.  The inter marriage of the giant public investments and the SMEs will do marvels in the transformation of Ethiopia’s economy.  This is something that will transcend circumscribed time boundary such as the 5 years’ Growth and Transformation Plan.  It is here, too, that the Government should stop for a while and think seriously over the recently launched Entrepreneurship Development Centre of Ethiopia, which has an inherent dynamism.
The formal and the informal sectors of the private economy should be clearly identified first and those hard-core small and medium enterprises that should work closely with the public investment sectors as specialized entities or units of the private business circles should be selected a-priory to receive the necessary entrepreneurial training that would undoubtedly develop their competencies and induce behavioural changes and approaches in their make-up.
There should be a clear vision of priorities in the selection processes.  If we ignore the selection priorities of SMEs in the order of infrastructure needs of manpower and participating entities within a specific plan period, the mass training of the 200,000 potential entrepreneurs and the envisaged 20,000 trainers across the board for every Tom, Dick and Harry, or to every café, beer house or tavern, in a period of three years, it will be a grandiose figure, and too late to correct if there at all there occurs a margin of error.  Therefore, the need of pin-pointing the essential SMEs on priority basis becomes mandatory.
It is my conviction that the influential public and private sectors should sit together in the process of selection.  Once this is done, it is my conviction that the current none or quasi-participation of the private sector via the SMEs in the public infrastructure development, as it is true in Japan, South Korea, India or, in general, in the South-East-Asian countries will be true here in Ethiopia, too. Then, the private sector will be engaged in enlarge sub-contracting businesses within the huge public infrastructure undertakings.
On the whole, the First National Business Conference is said to be an impressive gathering of like-minds who have a stake in the making of modern Ethiopia.  As for me, I have the impression that it has left a paramount imprint on qualitative transactional and transformational leadership.  Its contribution towards transparency, compromise, good governance, clear vision and judgment without complacency, complement accepted standards of democratic values and is a marked future trendsetter at that. 
Thank you